Exhibit 14.
AGREEMENT
AGREEMENT made this 1st day of November, 2002 by and between NEW SKY
COMMUNICATIONS, INC., a New York corporation with offices at 00 Xxxx Xxxx
Xxxxxx, Xxxxx 000, Xxxxxxxxx, Xxx Xxxx 00000, hereinafter referred to as "New
Sky" and XXXXX XXXXXX, residing at 0000 Xxx Xxxxxx Xxxx, Xxxxxxxxx, XX 00000;
XXXXXX X. XXXXXX, residing at 0000 Xxxxxxxxx Xxxx, Xxxxxxxxx, XX 00000;
XXXXXXXXX XXXXXX, residing at 00 Xxxx Xxxxxx, Xxxxxxx, XX 00000; XXXXXXX XXXXXX,
residing at 00 Xxxxxxxx Xxxxx, Xxxxxxxxx, XX 00000; and XXXXXXX XXXXX, residing
at 00 Xxxxxxxx Xxxx, Xxxxxxxxx, XX 00000; hereinafter referred to collectively
as "Shareholders."
WHEREAS Shareholders are desirous of selling and transferring to New Sky,
and New Sky is desirous of acquiring sub-license to certain technology and trade
secrets, existing grants of sub-licenses to such technology and all of the
outstanding stock of Document Security Consultants Corp. ("DSC") and Imperial
Encryptions, Inc.("IE");
NOW, the parties hereto covenant and agree as follows:
1. ASSIGNMENT OF SUB-LICENSE RIGHTS AND CORPORATE STOCK. Shareholders do
hereby grant to New Sky a sub-license in all of the technology, and trade
secrets relating to security paper and anti-counterfeiting technology owned,
held or controlled by Shareholders, or any one of them, in any capacity, and set
forth in Schedule A annexed hereto and made a part hereof. Each Shareholder also
sells, assigns and conveys to New Sky all of their right, title and interest in
all existing grants of sub-licenses in such technology and trade secrets as set
forth in Schedule B annexed hereto and made a part hereof. In addition, each
Shareholder does sell, assign and convey to New Sky all of their outstanding
stock of DSC. This transfer shall include the assets of DSC set forth in
Schedule C annexed hereto and made a part hereof, which is hereby warranted and
represented by Shareholders to be all of the assets of DSC. Xxxxxxxxx Xxxxxx
does also hereby sell, assign and convey to New Sky all of her outstanding stock
of IE.
2. CONSIDERATION. In consideration of the foregoing, New Sky shall grant to
each Shareholder 25,000 unregistered, restricted common shares of New Sky
Communications, Inc., in addition New Sky shall pay Shareholder, Xxxxxxxxx
Xxxxxx, $20,000.00 for her IE stock. In addition, each Shareholder shall be paid
a royalty of five percent (5%) of all current and future license and sub-license
fees and gross royalties paid to New Sky for licensing third parties to use any
of the technology set forth in Schedule A. New Sky shall also assume
responsibility to pay a royalty of twenty percent (20%) of all required current
license or sub-license fees to the Xxxxx Xxxxxx Estate, as defined and set forth
in Schedule B annexed hereto. In addition, New Sky shall pay to each Shareholder
hereunder a royalty of one percent (1%) of the gross sales price of any and all
product embodying any technology sub-licensed to New Sky and set forth in
Schedule A. Payment shall be made monthly, upon receipt of payment. New Sky
agrees to assume and pay the following liabilities of DSC, warranted and
represented by Shareholders to be all of the outstanding liabilities of DSC: (1)
approximately $40,000.00 to Xxxxxx Printers, (2) approximately $12,000.00 owed
Shareholder, Xxxxx Xxxxxx, and (3) approximately $975.00 in miscellaneous bills
and accrued sales commissions. In the event that New Sky shall cease trading
publicly for a period of ninety (90) days, if three of the Shareholders so
elect, the Shareholder shall have the right to cancel this Agreement, transfer
their New Sky stock back to New Sky and receive their respective shares of DSC
in return. In addition all assets except the physical assets transferred
hereunder shall be transferred back to DSC by New Sky.
3. CONDITION PRECEDENT: It shall be an express condition precedent of this
Agreement that all five parties named herein as Shareholders shall enter into
this Agreement and each tender their rights and stock herein set forth to New
Sky, or this Agreement shall not commence or take effect.
4. WARRANTIES AND REPRESENTATIONS. Each Shareholder, and the Shareholders
collectively warrant and represent the following:
a) Each Shareholder is the owner and holder, or controller of the right,
title and interest in the, trade secrets and intellectual property to which New
Sky is herein granted sub-license set forth in Schedule A and that the attached
Schedule A contains all of the trade secrets and intellectual property rights in
which each Shareholder has an interest or controls as of the date of this
Agreement and that such rights are not subject to any assignment, claim,
judgment, defense, set-off, lien or encumbrance of any kind.
b) Each Shareholder owns free and clear the outstanding stock of DSC, and
Xxxxxxxxx Xxxxxx owns free and clear fifty-one percent (51%) the outstanding
stock of IE, that each stock is fully paid, non-assessable and there exist no
outstanding agreements, claims, liens or encumbrances which would interfere with
or restrict the assignment or conveyance of such shares and the enjoyment of
full rights thereof by New Sky.
c) Each Shareholder is the sole and exclusive owner and holder of the grant
of sub-license set forth for them in Schedule B annexed hereto and such
interests are not subject to any assignment, claim, judgment, defense, set-off,
lien or encumbrance of any kind.
5. RESTRICTIVE COVENANT.
a) Each Shareholder acknowledges that the business of DSC and IE and the
grant of sub-license herein shall be an integral part of the business of New
Sky, and that if any Shareholder should render services similar to those of DSC
or IE in competition with New Sky, directly or indirectly, for two (2) years
hereafter, the same shall cause New Sky significant financial detriment which
could not be precisely determined at the time. Therefore, each Shareholder
acknowledges that he or she has been advised and herewith agrees that the
restrictive covenant contained within this paragraph is a specific condition and
material inducement to New Sky to purchase the shares of DSC, and IE, and that
New Sky has specifically stated that the offer to purchase shares of DSC, or IE,
provided for in this contract would not be offered to Shareholders if he or she
did not consent to and execute this restrictive covenant. The parties agree,
however, that Shareholders Xxxxxxxxx Xxxxxx and Xxxxxxx Xxxxxx, are Executors of
the Estate of Xxxxx Xxxxxx and Xxxx Xxxxxx is employed by the Estate business
and these Shareholders involvement in the Xxxxx Xxxxxx Estate business, shall
not violate this clause.
b) This covenant shall not apply if there is a material and willful breach
of any term of this Agreement by New Sky or if the Shareholders elect to
terminate this agreement pursuant to Paragraph 2 above.
c) Each Shareholder agrees that the contents of this Agreement and any
information obtained regarding the business practices and methods of New Sky are
confidential, including but not limited to, any and all patents, technology or
trade secrets owned or held by New Sky, any Shareholder, DSC, or IE, and shall
not be disclosed or discussed with any third party unless required by law.
6. DOCUMENT EXECUTION. Shareholders agrees to execute any and all
instruments and documentation deemed necessary by New Sky, in its sole
discretion, to effectuate the conveyances and assignments set forth in this
Agreement, including but not limited to, licenses to technology, and trade
secrets.
7. REPRESENTATIVES. This Agreement shall be binding upon and shall inure to
the benefit of the parties hereto, their respective assigns, successors, heirs
and legal representatives.
8. GOVERNING LAW. This Agreement is deemed made and executed in the State
of New York and the Supreme Court of that State, in and for the County of
Monroe, is hereby deemed to be the sole and convenient forum for the resolution
of disputes under this Agreement. The parties hereto agree that, except for any
and all remedies available under Section 5 herein, the parties shall seek money
damages only for any dispute under this Agreement and shall not seek injunctive
relief nor in any manner interfere with, hinder or delay the business operations
and exploitation of intellectual property of the other party.
9. INDEMNIFICATION. Each party hereto agrees to indemnify and hold harmless
the other, its agents and employees, against each and every claim, demand, loss,
liability, damage or expense (including without limitation, any settlement
payment, reasonable attorneys' fees and other expenses incurred in litigation or
settlement of any claim) of whatever nature suffered by the other party arising
out of or in connection with the conduct of that party prior to the commencement
of this Agreement, or any breach or misrepresentation contained in this
Agreement or in any exhibit, certificate or document required to be furnished in
connection with or pursuant to this Agreement.
NEW SKY COMMUNICATIONS, INC.
SEAL
By: /S/ XXXXXXX XXXXX
President
/S/XXXXX XXXXXX
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Xxxxx Xxxxxx
/S/ XXXXXXXXX XXXXXX
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Xxxxxxxxx Xxxxxx
/S/ XXXXXX X. XXXXXX
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Xxxxxx X. Xxxxxx
/S/ XXXXXXX XXXXXX
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Xxxxxxx Xxxxxx
/S/ XXXXXXX XXXXX
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Xxxxxxx Xxxxx
SCHEDULE A
A.) Sub-license of the license for USA Patent # 5,707,083 Wicker 2000
Trade Secrets including plates and Films at Xxxxxx Printers, subject
to the terms of the license agreement with the estate of Xxxxx
Xxxxxx.
B.) License agreement for USA Patent #5,454,598 Perf Product and Process,
including the right to sub-license.
